ECONOMICS OF FEED PRODUCTION - REQUIRED INGREDIENTS AND PROCEDURES

The resources, costs and returns and other factors affecting fish production. A sample of 44 fish farmers was randomly selected, collected in 2006 production season through administration of a questionnaire to the fish farmers. Analysis of the data was done using descriptive statistics and budgeting technique. The analysis revealed that land, water, labour and capital were the main resources employed in fish production. The costs and returns analysis indicated that, variable cost constituted 97.63% of the total cost of fish production in the study area, while the fixed cost constituted 2.37%. 

Amongst the variable inputs, fingerlings/juveniles (42.82%) and feed (34.70%) constituted the highest (77.52%) to cost of production, while hired labour constitutes 16.91%. The cost of production was N571, 231.79, the total revenue of N5, 853,625.64 and the net income was N5, 282, 393.85 indicating that fish production was highly profitable. Despite the high profitability in fish production, fish farmers identified lack of finance (97.7%), lack of good market (81.8%), pests anddiseases (56.8%), and water supply (21%) as their most important problems in fishproduction. With this high level of profitability in fish farming, it is recommended that this information should be disseminated to all the farmers in these and other surrounding communities.
How do I choose my Ingredients?
Three major factors govern the choice of ingredients, once you have decided to make your own aquaculture feeds. These are:
- Suitability for species being cultured (type and quality)
- Quantity available locally and regularity of supply
- Cost
SUITABILITY
Major sources of high-protein animal and vegetable ingredients, together with cereals or cereal by-products and, probably, vitamin/mineral premixes will be required. In fact a very wide range of ingredients can be utilized - this topic has been covered in section 4. Each species has its own dietary requirements (section 6). Some thrive better on certain types of ingredients than on others and different proportions of them are needed. The dietary requirements of different species are discussed in section 6, while Appendix II gives some typical examples of the various ingredients and their proportions (formulae) used in actual diets. Choosing the ingredients to be used in feed manufacture on your farm is firstly a matter of matching the types available locally (or that can be imported) with the needs of the formulae of feed suitable for the species of fish or shrimp which you are farming. The first thing to do therefore is to prepare a list of the raw materials available to you.
Having prepared that list, you must make an assessment of the quality of the ingredients available. This means you must carefully define each raw material (see sections 3 and 4) and allot to it a real or theoretical analytical composition. This information is essential before formulation work (section 5.2) can be done. Real analyses of local ingredients may be available from the suppliers or from surveys conducted by local government departments of fisheries or other livestock production departments or by local universities. In the absence of local information, ingredient compositional tables have to be used (Appendix IV). This is less satisfactory than the use of accurate local information but is often necessary.
Finally, you must try to find reputable suppliers who are known to supply good quality ingredients, free from adulteration and toxicity. Quality, as is stressed in many parts of this manual, is an essential part of your feeding programme which, if neglected, can have disastrous results. Talk to other livestock farmers and to the livestock departments in local universities and government institutions - they will be able to point you towards the reliable suppliers of ingredients.
QUANTITY AND REGULARITY OF SUPPLY
Choose ingredients which are regularly available in sufficient quantities. Some ingredients are only available seasonally. The more regular the supply of each ingredient is, the better. Otherwise you will have to purchase much larger quantities than you would like to, and face the problems of longer-term storage, or you will have to make frequent changes in your feed formulation because of the lack of a specific ingredient which is not available in sufficient quantities to supply your needs. Sometimes a very suitable ingredient may be available locally. However, if you want to include an ingredient in a formulation at a 57, inclusion level, for example, and you are going to make 500 tons of feed per year, but there is only about 100 kg of the material available per week, it is unsatisfactory. It is not going to be suitable for use, even though it is basically a good ingredient. In this situation it would be better Co include it in only one of the types of feed you are making (say for a starter feed) rather than try to include it in them all and run out of it every few days and have to change the formulae. So, the message is: choose ingredients which are available in sufficient quantities on a regular basis.
COST
Cost is the last but not the least of the three major factors to consider. The cost of each ingredient can vary quite markedly from one location to another, depending on supply and demand. What may be a very acceptable ingredient in one place may have to be rejected, or used in smaller quantities, in another because it is too expensive. Cost obviously interacts with availability and suitability. All these factors have to be reviewed simultaneously in the selection of ingredients for your compound feeds.
You should therefore complete your summary of the raw materials available in a tabular form which shows analytical characteristics (composition - from actual local data or from tables) and cost per unit at the farm site. This table will be used when you formulate your feed (i.e., decide how much of each ingredient to use) and assess its potential cost.

How do I Decide How Much of Each Ingredient to Use (Formulation)?
A great deal of information has, by now, been gathered by you. You know (section 5.1) the analytical characteristics and cost of the available ingredients; the requirements (section 6) on the animal you are farming are known; and typical examples of formulae are available (Appendix II). How is all this information to be put to use in deciding how a feed formulation should be constructed? Each ingredient used should be included because it contributes a particular component necessary in the diet. For example, it may be a good source of marine protein, it may supply a need for a certain type of fatty acid, etc. Also the object is to satisfy the dietary requirements of the animal at the cheapest cost. This is known as 'least cost formulation'.
Least cost formulation is best done using a specifically designed computer programme. The computer stores all the data gathered about the available raw materials (analyses and cost), together with the specifications of the feeds to be formulated. It will then do the necessary calculations and will turn out a least-cost formulation. Although computer hardware and software for this purpose is available it may not be economically sensible to purchase it unless very large numbers of such calculations are regularly necessary, e.g., in a large feed mill or a group of smaller ones. On an individual farm it may only be necessary to do the basic formulations once - after that it may only be a matter of examining the effect of relatively minor changes. These changes may be either in specification, based on new information as to the animal's requirements, or in the ingredients, based on new availability or cost data. Linear programming for least-cost formulation is therefore not dealt with in this manual since it is not thought appropriate for small scale aquaculture. Those who are interested in this subject are recommended to consult Chow et al., (1980).
Feed formulation by 'hand' calculation is a tedious and repetitive (but not difficult) process of trial and error. A simple calculator is necessary for this work. Some examples of the way in which it can be done are worked through in this section of the manual.
For formulation, the following information is necessary:
1. A list of available raw materials, together with compositional data and cost information;
2. The specifications of the diet to be made, in terms of levels of protein, lipid, EAA, EFA, etc.;
3. Knowledge of the special suitability of certain individual raw materials for the animal to be fed.
The first step in formulation is therefore to assemble the above information in an organized and accessible way.
The second stage is to draw up a worksheet for feed formulation, which includes provision for the major nutrients and for cost data. An example of a data sheet is given in Table 18.
In Table 18, column 1 is for the full description of the ingredients, column 2 is for the proposed inclusion rate, and column 3 is for the cost of that proposed inclusion rate (e.g., a 21% inclusion rate of an ingredient costing US$ 0.50/kg would contribute 0.50 × 21/100 = US$ 0.105 to the cost of each kg of diet). Columns 4 are for the contributions certain inclusion rates will make to the analytical characteristics of the diet (e.g., a 15% inclusion of an ingredient with a protein level of 44% would contribute 44 × 15/100 = 6.6% of protein to the final diet). Similarly column 5 is to record the available energy contributed to the feed by the inclusion level of each ingredient contemplated (see later in this sub-section for calculation of this factor). The results can then be totalled to see how they comply with the specifications for the ration. Re-adjustments can then be made, using another worksheet or modifications to the same one.
The worksheet given only refers to the major nutrients because it is necessary to balance these with the principal specifications of the diet first, before other factors such as EAA content, etc., can be examined. When the basic diet has been provisionally established its other analytical features can be examined and adjustments made to reach the final, balanced, formulation.
Now let us assume that we have ingredient data ready and that we have inserted on the worksheet (Table 18) what the specifications of the diet to be formulated are. How do we start the formulation? It is here that the experience of the formulator comes in. He will have certain pre-determined ideas in his mind about minimum inclusion rates of certain ingredients, based on his and others' experience. This experience is a constantly changing and developing matter; it is also very specific to the individual doing the formulation. It is therefore impossible to lay down in this manual specific rates of minimum inclusion, especially as there are so many species and different raw materials available. However, it is hoped that the examples of feed formulae given in Appendix II and the discussion of dietary requirements in section 6 will help you to start to form your own judgements of these matters. Personal judgement is an essential part of formulation and it is a factor which the computer cannot replace.
For the purpose of the following examples to be worked through in demonstrating how formulation is done, I have selected a very simple diet -initially to consist of only three ingredients - and a theoretical diet specification. For simplification I am also going to use only two analytical characteristics - the protein and the lipid level. I am also going to assume that, of these three ingredients, one which is of known nutritional value exists locally and is of acceptable cost. The formulator in the example has therefore already decided, on the basis of past experience, on a minimum inclusion rate for it. Thus the amount of this ingredient is already fixed. Let us assume that he has four other ingredients to select from.
Then the actual combinations of ingredients can be calculated as follows:



Thus, for the four alternatives, the levels of each ingredient in the final diet (remember the above mixture constitutes only 90% of the final mix) would be:
1.         44.8 × 0.9 = 40.3% groundnut and 55.2 × 0.9 = 49.7% rice
2.         52.6 × 0.9 = 47.3% groundnut and 47.4 × 0.9 = 42.7% maize
3.         28.4 × 0.9 = 25.6 soybean and 71.6 × 0.9 = 64.4% rice
4.         35.1 × 0.9 = 31.6 soybean and 64.9 × 0.9 = 58.4% maize         (Totals = 90%)
We can now check out the effect of combining each of the four alternatives with fish meal on the final dietary protein level and, while we are doing so, examine also the level of lipid in the final diet achieved by each combination. The diet cost can also be calculated from the ingredient costs.

Feed Types

Firstly I want to explain the types of aquaculture feed, before continuing to deal with the kinds of machinery used in their manufacture. Figure 3 shows the major types of feeds used in aquaculture.
Aquaculture feeds fall basically into two types - dry and non-dry. Dry feeds are normally made from dry ingredients but they can also be made by drying a feed made from moist ingredients or from mixtures of dry and moist ingredients. Dry feeds are not completely free from moisture; they reach an equilibrium moisture content (usually about 7-13%) depending on the environment. Non-dry feeds are divided into two major categories - wet and moist. There is no agreed or exact demarkation line between them: I define wet feeds as those which are made entirely or almost entirely from high moisture ingredients, such as 'trash' fish, waste slaughterhouse products, undried forage, etc. As such they would have moisture contents of about 45-70%. Moist feeds are made from mixtures of wet, or moist, and dry raw materials, or from dry ingredients to which moisture has been added. Usually moist feeds range from 18-45% moisture. There is no really clear division between 'moist' and 'wet' feeds. A third class of products - flaked feed - is designed for aquarium fish, fish fry and early post-larval shrimp and is therefore not covered in this manual.
Dry feeds may be simple mixtures of dry ingredients, in which case they are called 'mashes' or meals'. If they are formed into a compacted shape, which may be hard or relatively soft they are called pellets (sometimes large pellets are referred to as cubes in livestock feeds but this term is rarely applied in aquaculture because pellet size is mostly quite small). Pellets can be made in a range of sizes (see section 4.3.). Depending on the processing technique used, pellets may float or sink when placed in water. The non-floating type are often broken up and then sieved into a range of smaller sizes, called crumbles or granules, for small fish or shrimp.

Types of Machinery or Equipment

The main types of machinery necessary for the production of each type of aquaculture feed dealt with in this manual. A brief description of each piece of equipment follows. The names and addresses of some feed equipment suppliers are given in Appendix III.
Scales
Accurate scales for weighing ingredients and completed feeds are essential parts of all feed mills. For the size of operations being considered here, simple platform scales (Figure 4) are adequate. The type that have a direct reading dial are the easiest to use and are least likely to cause mistakes to be made. Those which require manual balancing by moving counter weights along a bar are less reliable, but cheaper. Accurate manufacture according to formulation depends on good scales; this item is often neglected, with insufficient money being spent on it. Scales with a taring device are the best (the ability to adjust to zero after a container has been placed on them so that the weight of the actual ingredient being weighed can be read directly from the dial).
Grinders/Mills (Dry Ingredients)
The mill or dry grinder is a means of reducing the size of dry ingredients so that they are suitable for mixing into a feed and for any subsequent processes that occur during manufacture. There are many types of mill available. The two most common ones are attrition, or plate mills, and hammermills.
The attrition or plate mill depends on shearing the feed between two roughened plates, one or both of which are 'rotating'. This type of mill is good for coarse grinding but is not very efficient at producing the fine particles from typical aquaculture feed ingredients which are necessary for high water stability feeds.
Hammermills are the type of impact mill (other types, such as centrifugal impact mills are frequently used for grinding flour) which is most generally suitable for reducing the particle size of a wide range of dry animal feed ingredients. The basic principle of the hammermill is that its grinding chamber consists of a series of stationary or, more often, swinging, hammers pinned to plates attached to a central rotor. The hammers strike and break up the incoming material, which is forced through a perforated steel screen. Sometimes a fan or blower is used to assist the removal of the ground product.

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